The General Ledger 4 Post to the ledger The 4 th step of the accounting cycle is to post to the ledger. The General Ledger is a book containing a separate page for each business account. The General Ledger serves as a permanent record of financial transactions for the business. Posting to the ledger is the process of transferring information from the General Journal to the individual General Ledger accounts. This is pretty easy. All I really have to do is copy the information that I already have in my general journal.
The Ledger Account Form Let s take a look at a sample General Ledger. To open a account with a zero balance 1) Write the name of the account on the top of the ledger form. 2) Write the account number on the ledger form. ACCOUNT OCT 1 Cash in Bank Balance 101 ACCOUNT NO. a 25,000 To open a account with a balance 3) Enter the date in the date column. 4) Write the word Balance in the description column. 5) Place a check mark in the post reference column to show that the amount is not being posted from the General Journal. 6) Enter the balance in the appropriate column.
Opening Ledger Accounts Account Name Account # Balance Cash in Bank 101 9,285 Accts Rec Smith 105 1,235 ACCOUNT ACCOUNT ACCOUNT ACCOUNT Account Name Account # Balance Accts Pay Jones B. Good, Capital Sales Revenue 201 301 401 980 27,260 0 Cash in Bank 101 ACCOUNT NO. OCT 1 Balance a 9,285 Accounts Receivable - Smith 105 ACCOUNT NO. OCT 1 Balance a 1,235 Accounts Payable - Jones 201 ACCOUNT NO. OCT 1 Balance a 980 B. Good, Capital 301 ACCOUNT ACCOUNT NO. OCT 1 Balance a 27,260 Sales Revenue 401 ACCOUNT NO.
Posting to the General Ledger GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 1 2 OCT 1 Cash in Bank 101 30,000 3 T. Rex, Capital 301 30,000 4 Memo 1 5 3 Office Equipment 125 6,740 6 Cash in Bank 101 6,740 7 Check 101 ACCOUNT Cash in Bank ACCOUNT NO. 101 OCT 1 G1 30,000 30,000 3 G1 6,740 23,260 ACCOUNT T. Rex, Capital ACCOUNT NO. 301 OCT 1 G1 30,000 30,000 ACCOUNT Office Equipment ACCOUNT NO. 125 OCT 3 G1 6,740 6,740
Homework Textbook Page: 156 & 164 Workbook Page: 106 & 107 Problem 7-1, Problem 7-2
Posting Transaction 1 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 1 2 OCT 1 Cash in Bank 101 25,000 3 M. Sanchez, Capital 301 25,000 4 Memo 1 ACCOUNT Cash in Bank ACCOUNT NO. 101 OCT 1 ACCOUNT Maria Sanchez, Capital ACCOUNT NO. 301 G1 25,000 25,000 OCT 1 G1 25,000 25,000
Posting Transaction 2 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 5 2 Office Equipment 120 400 6 M. Sanchez, Capital 301 400 7 Memo 2 ACCOUNT Office Equipment ACCOUNT NO. 120 OCT 2 G1 400 400 ACCOUNT Maria Sanchez, Capital ACCOUNT NO. 301 OCT 1 G1 25,000 25,000 2 G1 400 25,400
Posting Transaction 3 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 8 4 Computer Equipment 115 3,000 9 Cash in Bank 101 3,000 10 Check 101 ACCOUNT Computer Equipment ACCOUNT NO. 115 OCT 4 G1 3,000 3,000 ACCOUNT Cash in Bank ACCOUNT NO. 101 OCT 1 G1 25,000 25,000 2 G1 3,000 22,000
Posting Transaction 4 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 11 9 Delivery Equipment 125 12,000 12 Accts Payable - North Shore Auto 205 12,000 13 Invoice 200 ACCOUNT Delivery Equipment ACCOUNT NO. 125 OCT 9 G1 12,000 12,000 ACCOUNT Accounts Payable - North Shore Auto ACCOUNT NO. 205 OCT 9 G1 12,000 12,000
Posting Transaction 5 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 14 11 Accounts Receivable - Green Company 110 200 15 Office Equipment 120 200 16 Memo 3 ACCOUNT Accounts Receivable ACCOUNT NO. 110 OCT 11 G1 200 200 ACCOUNT Office Equipment ACCOUNT NO. 120 OCT 2 G1 400 400 11 G1 200 200
Posting Transaction 6 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 17 12 Accounts Payable - North Shore Auto 205 350 18 Cash in Bank 101 350 19 Check 102 ACCOUNT Accounts Payable - North Shore Auto ACCOUNT NO. 205 OCT 1 G1 12,000 12,000 12 G1 350 11,650 ACCOUNT Cash in Bank ACCOUNT NO. 101 4 G1 3,000 22,000 12 G1 350 21,650
Posting Transaction 7 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 20 14 Cash in Bank 101 200 21 Accounts Receivable - Green Co 110 200 22 Receipt 1 ACCOUNT Cash in Bank ACCOUNT NO. 101 12 G1 350 21,650 14 G1 200 21,850 ACCOUNT Accounts Receivable - Green Company ACCOUNT NO. 110 11 G1 200 200 14 G1 200 ------
Posting Transaction 8 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 23 15 Cash in Bank 101 1,200 24 Delivery Revenue 401 1,200 25 Receipt 2 ACCOUNT Cash in Bank ACCOUNT NO. 101 14 G1 200 21,850 15 G1 1,200 23,050 ACCOUNT Delivery Revenue ACCOUNT NO. 401 OCT 15 G1 1,200 1,200
Posting Transaction 9 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 26 16 Rent Expense 510 700 27 Cash in Bank 101 700 28 Check 103 ACCOUNT Rent Expense ACCOUNT NO. 510 OCT 15 G1 700 700 ACCOUNT Cash in Bank ACCOUNT NO. 101 15 G1 1,200 23,050 16 G1 700 22,350
Posting Transaction 10 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 29 18 Advertising Expense 501 75 30 Accounts Pay - Beacon Advertising 201 75 31 Invoice 129 ACCOUNT Advertising Expense ACCOUNT NO. 501 OCT 18 G1 75 75 ACCOUNT Accounts Payable - Beacon Advertising ACCOUNT NO. 201 OCT 18 G1 75 75
Posting Transaction 11 GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 32 20 Accounts Receivable - City News 105 1,450 33 Delivery Revenue 401 1,450 34 Sales Invoice 1 ACCOUNT Accounts Receivable - City News ACCOUNT NO. 105 OCT 20 G1 1,450 1,450 ACCOUNT Delivery Revenue ACCOUNT NO. 401 OCT 15 G1 1,200 1,200 20 G1 1,450 2,650
Posting Transaction 12 GENERAL JOURNAL Page: 2 REF DEBIT CREDIT 1 2 OCT 28 Utilities Expense 515 125 3 Cash in Bank 101 125 4 Check 104 ACCOUNT Utilities Expense ACCOUNT NO. 515 OCT 28 G2 125 125 ACCOUNT Cash in Bank ACCOUNT NO. 101 16 G1 700 22,350 28 G2 125 22,225
Posting Transaction 13 GENERAL JOURNAL Page: 2 REF DEBIT CREDIT 5 29 Maintenance Expense 505 600 6 Cash in Bank 101 600 7 Check 105 ACCOUNT Maintenance Expense ACCOUNT NO. 505 OCT 29 G2 600 600 ACCOUNT Cash in Bank ACCOUNT NO. 101 28 G2 125 22,225 29 G2 600 21,625
Posting Transaction 14 GENERAL JOURNAL Page: 2 REF DEBIT CREDIT 8 31 M. Sanchez, Withdrawals 302 500 9 Cash in Bank 101 500 10 Check 106 ACCOUNT Maria Sanchez, Withdrawals ACCOUNT NO. 302 OCT 31 G2 500 500 ACCOUNT Cash in Bank ACCOUNT NO. 101 29 G2 600 21,625 31 G2 500 21,125
General Ledger Summary 1 ACCOUNT Cash in Bank ACCOUNT NO. 101 OCT 1 G1 25,000 25,000 4 G1 3,000 22,000 12 G1 350 21,650 14 G1 200 21,850 15 G1 1,200 23,050 16 G1 700 22,350 28 G2 125 22,225 29 G2 600 21,625 31 G2 500 21,125 ACCOUNT Accounts Receivable - City News ACCOUNT NO. 105 OCT 20 G1 1,450 1,450
General Ledger Summary 2 ACCOUNT Accounts Receivable - Green Comapany ACCOUNT NO. 110 OCT 11 G1 200 200 14 G1 200 - ACCOUNT Computer Equipment ACCOUNT NO. 115 OCT 4 G1 3,000 3,000 ACCOUNT Office Equipment ACCOUNT NO. 120 OCT 2 G1 400 400 4 G1 200 200
General Ledger Summary 3 ACCOUNT Delevery Equipment ACCOUNT NO. 125 OCT 9 G1 12,000 12,000 ACCOUNT Accounts Payable - Beacon Advertising ACCOUNT NO. 201 OCT 18 G1 75 75 ACCOUNT Accounts Payable - North Shore Auto ACCOUNT NO. 205 OCT 9 G1 12,000 12,000 12 G1 350 11,650
General Ledger Summary 4 ACCOUNT Maria Sanchez, Capital ACCOUNT NO. 301 OCT 1 G1 25,000 25,000 2 G1 400 25,400 ACCOUNT Maria Sanchez, Withdrawals ACCOUNT NO. 302 OCT 31 G2 500 500 ACCOUNT Income Summary ACCOUNT NO. 303
General Ledger Summary 5 ACCOUNT Delivery Revenue ACCOUNT NO. 401 OCT 15 G1 1,200 1,200 20 G1 1,450 2,650 ACCOUNT Advertising Expense ACCOUNT NO. 501 OCT 18 G1 75 75 ACCOUNT Maintenance Expense ACCOUNT NO. 505 OCT 29 G2 600 600
General Ledger Summary 6 ACCOUNT Rent Expense ACCOUNT NO. 510 OCT 16 G1 700 700 ACCOUNT Utilities Expense ACCOUNT NO. 515 OCT 28 G2 125 125 This takes a long time, but it s pretty easy.
Homework Textbook Page: 175 Workbook Page: 115-117 Problem 7-5
Problem 7-1 Cash in Bank 101 JAN 1 Balance a 10000 Accts Rec Mark Cohen 104 JAN 1 Balance a 2000 Accts Pay Jenco Industries 203 JAN 1 Balance a 10000 Tom Torrie - Capital 301 That was easy JAN 1 Balance a 35000 Admissions Revenue 401
Problem 7-2 May 1 G1 10000 10000 That was easy May 1 G1 10000 10000
Classwork Textbook Page: 175-176 Workbook Page: 123 Problem 7-7 General Journal Only
Roadrunner Delivery Service Trial Balance October 31, 101 Cash in Bank 21,125 105 Accounts Receivable - City News 1,450 110 Accounts Receivable - Green Company ------ 115 Computer Equipment 3,000 120 Office Equipment 200 125 Delivery Equipment 12,000 201 Accounts Payable - Beacon Advertising 75 205 Accounts Payable - North Shore Auto 11,650 301 Maria Sanchez, Capital 25,400 302 Maria Sanchez, Withdrawals 500 303 Income Summary ------ ------ 401 Delivery Revenue 2,650 501 Advertising Expense 75 505 Maintenance Expense 600 510 Rent Expense 700 515 Utilities Expense 125 Totals 39,775 39,775
Classwork Textbook Page: 175 Workbook Page: 118-120 Problem 7-6
Homework Textbook Page: 175-176 Workbook Page: 121-124 Problem 7-7
Homework Workbook Page: 125-130 Problem 7-8
Correcting Entries The method for correcting an error depends on when and where the error is found. There are three types of errors. Error in a Journal entry that has not been posted to the ledger Error in posting to the Ledger when the Journal is correct Error in a Journal entry that has been posted to the Ledger Draw a single line through the incorrect item and write the correction directly above it Draw a single line through the incorrect item and write the correction directly above it A correcting entry must be made in the Journal and then posted to the Ledger Let s make no mistake about it, we should probably take a look at an example of each type of error.
Error in a Journal entry that has not been posted to the Ledger GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 26 16 Rent Expense 900 27 Cash in Bank 900 28 Check 103 You discover that the check for the rent was actually for $700. Draw a single line through the incorrect item and write the correction directly above it. GENERAL JOURNAL Page: 1 REF DEBIT CREDIT 700 26 16 Rent Expense 900 700 27 Cash in Bank 900 28 Check 103
Error in posting to the Ledger when the Journal entry is correct ACCOUNT Accounts Payable - North Shore Auto ACCOUNT NO. 205 OCT 9 G1 12,000 12,000 12 G1 350 11,650 You discover that the entry on Oct 12 th in the Journal was actually $3,150. Draw a single line through the incorrect item and write the correction directly above it. Don t forget to also correct the balance. ACCOUNT Accounts Payable - North Shore Auto ACCOUNT NO. 205 OCT 9 G1 12,000 12,000 3,150 8,850 12 G1 350 11,650
Error in a Journal entry that has been posted On Nov 23 rd you write memo #68 indicating that a $200 check to pay the electricity bill on Nov 15 th was incorrectly journalized and posted to the Maintenance Expense account instead of the Utilities Expense account. A correcting entry must be made in the journal and posted to the Ledger. GENERAL JOURNAL Page: 5 REF DEBIT CREDIT 24 23 Utilities Expense 200 25 Maintenance Expense 200 26 Memo 68 ACCOUNT Utilities Expense ACCOUNT NO. 515 9 G4 145 145 23 Correcting Entry G5 200 345 ACCOUNT Maintenance Expense ACCOUNT NO. 505 515 505 15 G4 200 870 23 Correcting Entry G5 200 670
Homework Textbook Page: 177 Workbook Page: 131-134 Problem 7-9